$17 trillion in debt? No, more like $206 trillion.

Recent headlines say that President Obama succeeded in breaking the debt limit to allow federal borrowing beyond $17 trillion. But Stanley Druckenmiller, one of the most successful money managers of all time, says “there’s just one little problem” with Washington’s math. “Everyone’s running around saying the debt is $17 trillion,” notes Mr. Druckenmiller. But the government can acknowledge that titanic burden on future generations only by ignoring even larger obligations.

“If you borrow money from an individual with the agreement to pay them back in benefit payments in Social Security and Medicare after the age of 65, in their brilliance the United States accounting experts call that revenues,” says Mr. Druckenmiller. “But in any corporation in America—other than maybe Enron—if you borrow money from someone with the agreement to pay it back in the future, that’s called a debt.” And these future commitments don’t appear on Uncle Sam’s balance sheet.

What’s the real burden when you count these promises? Taking the “alternative fiscal scenario” from the Congressional Budget Office, which still understates the problem but is the closest Washington gets to reality, Mr. Druckenmiller calculates the net present value of Beltway commitments. He concludes that “the future liabilities are $205 trillion, not 17.” It’s a staggering sum, roughly 12 times the size of the U.S. economy.

Mr. Druckenmiller notes that he’s counting up all the federal promises from here to eternity, while others prefer to focus on shorter time horizons. And to be sure, investors in U.S. Treasury debt have a legal claim to repayment whereas future retirees have only promises from politicians. But that doesn’t make the need for reform any less urgent.